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Alex is assessing the price of Fortis

Finance

Alex is assessing the price of Fortis. She expects Fortis to growth dividends at its historical rate of 4.5% per year over the next three years, and following that, she expects the dividend growth rate to steady to the industry average of 2%. If Fortis shareholders expect a return on equity of 8% per year and the annual dividend paid exactly one year ago was $4.75, what is Alex's per share estimate of Fortis' equity value? If the shares are currently trading for $97.05 per share, should Alex buy, sell, or hold the share?

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